consumption

Question 1

consumption

Answer 1

total expenditure by households on goods and services over a period of time

Question 2

durable goods

Answer 2

goods consumed over a long period of time

Question 3

non-durable goods

Answer 3

goods consumed almost immediately

Question 4

saving

Answer 4

portion of households’ disposable income which isn’t spent over a period of time

Question 5

disposable income

Answer 5

household income over a period of time
includes state benefits + less direct taxes

Question 6

consumption function

Answer 6

relationship between consumption of households and the factors that determine it

Question 7

marginal propensity to consume (MPS)

Answer 7

proportion of a change in income that is spent

Question 8

MPC equation

Answer 8

change in C / change in Y

Question 9

average propensity to consume (APS)

Answer 9

proportion of total income spent

Question 10

APS equation

Answer 10

C/Y

Question 11

wealth effect

Answer 11

change in consumption following a change in wealth

Question 12

savings function

Answer 12

relationship between the saving of households and the factors which determine it

Question 13

average propensity to save

Answer 13

proportion of total income saved
S/Y

Question 14

marginal propensity to save

Answer 14

proportion of a change in income that is saved
change in S / change in Y